In today's business-to-business e-commerce environments, purchase order and invoice information are often carried in XML (Extensible Markup Language), EDI (Electronic Data Interchange), or proprietary transmission packages over the Internet or private networks, while trading partners deal with the payment side of the transaction through other channels. According to a study done by the Small Business Association in June of 2000, “The transaction value of B2B e-commerce over the Internet is expected to be $2 trillion by 2003, and an additional $780 billion in purchases will be made over private networks using electronic data interchange (EDI).
The multitude of data protocol transmission formats coupled with the multitude of unique and elaborate information sets in varying formats, such as those required by ERP (Enterprise Resource Planning), EPE (Electronic Procurement Engine) systems, etc., make the translation of data a very tedious and complex task.
A basic business requirement exists to translate and match appropriate information between disparate protocols, information systems, payment mechanisms, and trading partners. Businesses need to quickly assess a trading partner's data standards against their own internal set of requirements, and to quickly develop matching strategy necessary to efficiently and effective conduct business.
Further, in today's e-commerce environment, shipments are often made from multiple locations on different dates against multiple purchase orders. Trading partners, in some cases, are known entities with the buyer and selling having pre-defined payment terms. The opposite situation also exists where credit is a key component of the transaction. In the real world, it is the complexity of the order, fulfillment, and shipping process that adds significant dimensions to the problem. As an example, standing orders with releases translating into shipments from multiple warehouses to multiple locations is an everyday occurrence.
A significant problem for the e-commerce model is the reconciliation of payments against the above-mentioned scenario. If one then adds both shipping costs and taxes assessed, we now have a high level picture of the real opportunity.
It is the reconciliation of order and invoice information with the financial transaction that often becomes mission critical for businesses today. It is a key business requirement that financial institutions be able to match payment information with order, shipment, and invoice information. It is also critical that financial institutions be able to easily interface with the various e-commerce partners to provide the bank's real added value.
In order for e-commerce partners, particularly financial partners, to accept a standard XML feed from clients, they need to quickly understand what other systems are capable of sending and receiving. For example, if a bank wanted to build a map to Commerce One, it would need to know what Commerce One is expecting to receive and how that information compares to its key financial and enhanced payment data. If two Electronic Procurement Systems are using xCBL and cXML respectively, sending similar data, with individual data elements labeled differently, or if there are gaps in either version, it can be a very time-consuming process to find these differences and accommodate them. Yet, in most environments, partners must be able to process information from a wide array of file types.